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Commerce Commission outlines scope and focus of supermarket probe

Grocery shopping

The Commerce Commission today released its preliminary thoughts and outlined the proposed scope of its probe into competition in the supermarket industry.

The Commission is planning to focus on the structure of the industry, as well as the nature of competition from a wholesale and retail perspective, as well as pricing and procurement practices, and the nature of private-label brands and their impact on the industry.

Finally, the probe will investigate whether these factors tie together to create a fair offering for customers, and whether the pandemic has created changes in the sector that could impact competition in the long term.

“We expect that the issues we focus on will evolve as our understanding of the sector develops and we want feedback from customers, suppliers and retailers to ensure we focus on the right issues,” Commission chair Anna Rawlings said.

“The purpose of our market study is to look at whether competition is working well for consumers, and if not, what can be done to improve it.”

The study will focus on the two major grocery retailers in New Zealand – Woolworths NZ, which trades as Countdown, and Foodstuffs – in an effort to ascertain if the perceived duology pushes smaller players, or new players, out of the market.

A draft report will be prepared and delivered next July, while the final report is scheduled to be completed by late November 2021.

Both Countdown and Foodstuffs have agreed to comply with the study.

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